Cosco, “K” Line, Yang Ming, Hanjin and Evergreen have confirmed that the five parties have agreed in principle to establish a shipping alliance, but said the vessel-sharing agreement of the five carriers will be operational only on the trades between Asia and Europe, including the Mediterranean region.
The lines intend to formally begin the new Alliance on March 1, subject to compliance with the relevant regulations, and start up the operation in mid-April. The five carriers said they have reported to the European Commission their plan to form the alliance, and they have completed their self assessment required by EU competition law.
Pointing to statistics from Alphaliner, the five carriers say their market share in the Far East-Europe trade will be 23 percent, with 17 percent coming from the CKYH members and 6 percent from Evergreen; they say this is within the thresholds of the EC's consortia block exemption.
At a global shipping summit held in December in Washington, D.C., Hubert de Broca, the EC's head of unit for the Directorate General for Competition, Antitrust-Transport, Post and Other Services, said that under European competition law, liner shipping consortia have antitrust immunity if they have less than a 30-percent share
, but if consortia have more than a 30-percent share, they are subject to closer scrutiny.
The five carriers will operate six loops between Asia and Northern Europe, and four loops dedicated to the Asia-Mediterranean route. Evergreen said there would be no significant increase in capacity after the expanded alliance is formed. They said they see their partnership as being one for the long term.
The five carriers said in a statement that shippers "will benefit from a better quality of service in terms of transit times and service frequency.
"Operational efficiencies will also strengthen the alliance members’ effective environmental stewardship," they continued. "The lines have a commitment to cleaner shipping, which they understand their customers value highly. The alliance will continue to pursue measures to minimize bunker consumption via ‘eco-slow steaming’ and to reduce CO2 emissions."
Asked if the new alliance might be extended to other trades, an Evergreen official noted that it already has individual service cooperation with COSCO, K Line, Yang Ming and Hanjin on other routes.
"In the future, we are seeking further cooperation either with individual members or to join the alliance in other markets such as North-South trades and regional feeder routes in order to enhance service frequency and widen geographic coverage," a spokeswoman said.
Evergreen has a tradition of independence, and the company said it plans to remain flexible in its strategic planning, linking up with the CKYH alliance to enhance competitiveness and seeking different partners on some other markets. It said it welcomed the possibility of inviting other carriers into the alliance, subject to regulatory approval.
Port rotations for the new services are:
- NE3 (11 ships with 13,000 TEU capacity): Tianjin(Xingang) – Dalin – Qingdao – Shanghai – Ningbo – Singapore – Rotterdam – Felixstowe – Hamburg – Antwerp – Hong Kong – Shanghai
- NE6 (11 ships with 12,000 TEU capacity): Qingdao – Kwang Yang – Pusan – Shanghai – Yantian – Singapore – Algeciras – Hamburg – Rotterdam – Le Harve – Algeciras – Singapore - Yantian
- CEM (10 ships with 14,000 TEU capacity): Shanghai – Ningbo – Shekou – Tanjung Pelepas – Piraeus – Rotterdam – Felixstowe – Hamburg – Piraeus – Tanjung Pelepas – Kaohsiung
- Central China Express(NE7/CES) (10 ships with 8,500 TEU capacity): Taipei – Ningbo – Shanghai – Colombo – Felixstowe – Hamburg – Rotterdam – Le Harve – Colombo
- NE2 (10 ships with 8,500 TEU capacity): Kaohsiung – Yantian – Singapore – Rotterdam – Hamburg – Felixstowe – Anwterp – Port Said East – Singapore – Hong Kong
- South China Express NE8 (10 ships with 8,500 TEU capacity): Xiamen - Nanshan - Hong Kong – Yantian – Singapore – Hamburg – Rotterdam - Antwerp
- MD1 (10 ships with 8,000-10,000 TEU capacity): Pusan - Qingdao – Shanghai – Ningbo – Nansha – Hong Kong – Yantian - Singapore – Piraeus – La Spezia – Genoa – Barcelona – Valencia – Piraeus – Singapore – Ho Chi Minh – Hong Kong – Yantian – Shanghai
- MD2 (10 ships with 8,500 TEU capacity): Ningbo – Shanghai – Xiamen – Kaohsiung – Hong Kong – Yantian – Singapore – Port Said East – Ashdod – Genoa – Barcelona – Fos – Port Said East – Singapore – Hong Kong
- MD3 (eight ships with 5,500 TEU capacity): Shanghai – Ningbo – Hong Kong – Yantian – Singapore – Port Said West – Piraeus – Napoli – Livorno – Port Said West – Singapore – Yantian/Hong Kong
- UAM (15 ships with 5,500-6,500 TEU capacity):Tokyo – Osaka – Pusan – Qingdao – Shanghai – Ningbo – Kaohsiung –Shekou – Yantian –Tanjung Pelepas – Ashdod – Alexandra – Taranto – Koper – Trieste – Taranto – Colombo – Tanjung Pelepas – Kaohsiung – Hong Kong – Yantian – Shanghai – Ningbo